With 2026 now underway, it is timely to reflect on the significant changes that shaped the workplace relations landscape over the past year, writes HVIA Employer Assist provider Industry Legal Group.
For employers, 2025 brought a wave of reform, with new compliance obligations and expanded employee entitlements. Following is a brief overview of some key developments.
Criminalisation of Wage Theft
From January 1, 2025, the intentional underpayment of wages became a criminal offence under the Fair Work Act 2009 (FW Act). Employers who knowingly underpay staff now face significant penalties, including fines and up to 10 years’ imprisonment. The offence requires proof of intent and may be prosecuted within six years.
Small business employers may avoid criminal referral if the Fair Work Ombudsman (FWO) is satisfied they have complied with the Voluntary Small Business Wage Compliance Code, which outlines steps to demonstrate that underpayments were not deliberate. Civil enforcement may still apply.
In May 2025, the FWO also released a Payroll Remediation Program Guide to help businesses identify and rectify underpayments. It outlines a structured approach to reviewing payroll records and sets expectations around cooperation, including with the FWO, and record-keeping.
Sexual Harassment In Queensland
From March 1, 2025, businesses in Queensland became obligated under the Work Health and Safety Regulation 2011 to prepare and implement a written prevention plan to manage the risk of sexual harassment and sex or gender-based harassment.
The requirement aims to prevent such harassment by helping employers to proactively identify risks and implement measures to eliminate or, if not possible, minimise the risk to employees in consultation with them. WorkSafe Queensland has developed a template prevention plan.
Right To Disconnect
From August 26, 2025, small business employers became subject to obligations regarding an employee’s statutory right to disconnect, which was already applicable to larger employers. The statutory right to disconnect, allows employees to reasonably refuse contact outside ordinary hours.
Casual To Permanent
Casual employees gained access to the employee choice pathway to change from casual to permanent from August 26, 2025 for small business employers and from February 26, 2025 for other employers. Employers must comply with time limits to respond to a request and have limited grounds to refuse.
Redundancy and Redeployment
In Helensburgh Coal Pty Ltd Vs. Bartley & Ors [2025] HCA 29, the High Court confirmed employers may need to consider redeploying employees to roles currently performed by contractors.
The decision underscores the need to assess all reasonable redeployment options before proceeding with redundancies.
Salary Set-Off Arrangements
In Fair Work Ombudsman Vs. Woolworths Group Ltd [2025] FCA 1092, the Federal Court ruled set-off clauses can only operate within the same pay period. Employers paying annualised salaries must also maintain accurate and accessible records of hours worked. The decision has broad implications for compliance where award entitlements are offset by salary arrangements.
The implications for employers are wide-ranging: those using annualised salary models must ensure that they have appropriately drafted contractual set off clauses and implement systems that track hours worked against award entitlements each pay cycle, or risk exposure to back-pay liabilities and regulatory sanctions.
Restraint Clause Reform On The Horizon
As part of the 2025-26 Federal Budget, the Government proposed reforms to post-employment restraints, including banning non-compete clauses for employees earning below the high-income threshold and prohibiting wage-fixing and no-poach agreements. The reforms are expected to progress toward implementation from 2027.
Parental Leave Protections Following Still Birth
From November 2025, new provisions under the Fair Work Amendment (Baby Priya’s) Act 2025 protect access to employer-funded paid parental leave in cases of stillbirth or infant death.
Unless employment terms expressly provide otherwise, such entitlements cannot be cancelled. The entitlement is now recognised as a workplace right under the general protections regime.
Psychosocial Risk Regulation In Victoria
From December 1, 2025, new regulations commenced under Victoria’s occupational health and safety framework, require employers to identify, assess and control psychosocial risks. The regulations require alterations to structural and organisational controls, such as management of work, predominantly over training or information. Employers operating in Victoria should ensure systems are in place to demonstrate compliance.
Payday Superannuation
Legislation passed in November 2025 will require employers to pay superannuation at the same time as salary and wages from July 1, 2026.
If the superannuation doesn’t reach the super fund within seven business days the superannuation guarantee charge penalty applies unless an extended timeframe applies, highlighting the need for accurate and timely payroll processing.
Year In Review
The changes introduced in 2025 marked a significant shift in employment regulation. As 2026 progresses, businesses should continue to review workplace policies, contracts and systems to ensure compliance with the current legal framework.
Further Information
If you need assistance, please contact Employer Assist on (07) 3376 6266 or hvia@employerassist.com.au.